Good morning, friends. We made it through another workweek together and our reward is a nice, relaxing weekend. We have a packed issue to send you into the final workday of the week, with plenty of investment and M&A news and yet another miller set to IPO.

BUT FIRST, a look at what’s happening today and into the weekend:

#1- Leaf Global Environmental Services shares begin trading on the Nomu parallel market today, Tadawul said in a statement. The Jeddah-based environment consultant is selling a 30% stake in an offering that was 1.25x oversubscribed, according to Argaam. Leaf Global’s shares will debut at SAR 50.0 apiece.

ADVISORS- Al Khair Capital is quarterbacking the transaction as financial advisor and lead manager.

Speaking of IPOs: Shares of Riyadh-based advisor, brokerage house, and asset manager Yaqeen Capital closed in red on their first day of trading on parallel market Nomu. Yaqeen shares dropped 19.4% to SAR 32.30 at yesterday’s close. The firm, itself a top advisor on Nomu IPOs, took a 20% stake to market.

#2- A Saudi delegation is in Washington for a meeting of the Saudi-US Trade and Investment Council, which kicked off on Sunday and wrap up tomorrow. The delegation, led by Saudi General Authority of Foreign Trade (SGAFT) Deputy Governor Abdulaziz Alsakran, also includes reps from the Public Investment Fund as well as the commerce, energy, investment, education, tourism, and industry ministries. Some 20 Saudi agencies are there.

#3- Our friends at the US Chamber of Commerce are hosting tomorrow a Friday a private-sector meeting on the sidelines of the government-to-government TIFA meeting. We’ll have more on that next week.

#4- A Saudi delegation is at the 2024 Global Logistics Forum, which is on its last day today in Shanghai. The delegation includes representatives from the transport and logistics services and investment ministries, the Transport General Authority, Mawani, and Saudi Arabia Railways, among several others.

#5- The World Economic Forum’s “annual meeting of the new champions” continues this morning. You can live stream select public sessions here, with topics including Chinese innovation, healthcare analytics, and US-China relations.

#6- The Mechanical Circulatory Support Conference kicks off today in Riyadh at the King Salman Auditorium at King Faisal Specialist Hospital and Research Centre. The event, which wraps this Saturday, brings together medical professionals from around the world in over 20 interactive scientific meetings, discussion sessions, and workshops.

#7- In Geneva? Love camels? A Saudi exhibition on camels and their contribution to food security and economic growth runs in Geneva over the weekend, state news agency SPA writes. The four-day exhibition is organized by the Kingdom’s permanent mission to Geneva, which is working with Bolivia to bring the show to life.

WEATHER- Riyadh and Makkah are looking at a daytime high of 45°C today and a nighttime low of 30°C. Meanwhile in Madinah, the mercury will peak at 46°C before dropping to a balmy 29°C.

WATCH THIS SPACE-

#1- Mizuho is coming to town: Japan’s second-largest bank, Mizuho, is set to open its regional headquarters in the Kingdom after receiving a license from the Investment Ministry, Bloomberg reports. The report did not include details of how large an operation Mizuho is looking to plant here.

Mizuho currently runs its Saudi business out of Dubai and has taken pieces of debt capital market transactions for clients including the Public Investment Fund (PIF), the Finance Ministry, and Aramco, among others. It has had an investment banking license in Riyadh since 2009.

BACKGROUND- Earlier this year, the government rolled out tax incentives for foreign companies that relocate their regional headquarters to the Kingdom — and state institutions are helping with the push. The incentives are part of a plan that is a cornerstone of Crown Prince and Prime Minister Mohammed bin Salman’s drive to build a diversified, globally significant non-oil economy, and has been in the works since February 2021.

It’s helping turbocharge real estate prices, which continue to drive inflation as dozens of big global companies including Goldman Sachs, Merck, and EY name Riyadh their regional headquarters.

#2- The Kingdom is looking to attract some 5 mn Chinese tourists by 2030, up from 100k visitors from the country last year, Saudi Tourism Society Chairman Emad Monshi told Asharq Business (watch, runtime: 7:48) on Tuesday. China spends over USD 250 bn on tourism-related activities every year, he added.

IN CONTEXT- Earlier this week, China added Saudi to its list of countries with an “approved destination status.” The ADS label, which comes into effect on Monday, 1 July, means that Saudi is now on the list of countries to which Chinese tour agencies can organize group trips. The Saudi Tourism Authority has also worked to facilitate visas, improve air connectivity, and ensure Chinese tourists will be able to access travel information on Visit Saudi in Mandarin, Tourism Minister Ahmed Al Khateeb said.

#3- The General Authority for Competition (GAC) took legal action last year against 107 car distributors it said had engaged in market manipulation, it said in its annual report (pdf). Seventeen companies made requests to settle the charges. The authority accused the distributors of offenses including price-fixing and bids to lock some distributors out of specific geographical areas.

BACKGROUND- GAC has been cracking down on car distributors and dealerships whose practices the authority claims had been driving up the price of cars. That drive may be working: New vehicle prices fell 4.1% y-o-y in April, the latest month for which inflation figures are out.

#4- International flight bookings to Saudi climbed 57% y-o-y in the days following the Eid Al Adha holiday, at an average cost of USD 207 a seat, online travel platform Wingie reports. Travelers from Egypt, Turkey, Germany, India, and the UAE are the big drivers of demand as the Kingdom gears up to host some of its biggest summer events this season, Wingie said.

What are people coming in for?

  • The Esports World Cup runs from Thursday, 4 July to Sunday, 25 August in Riyadh;
  • Saudi Summer (May-September)
  • Summer in AlUla (May-August)
  • Jeddah Season (June-August).

#5- More debt relief for Somalia? Finance Minister Mohamed Al Jadaan signed a bridge loan agreement with the Opec Fund for International Development to provide debt relief for Somalia, according to a post on X by the minister.

IN CONTEXT- Officials of the Paris Club group of creditor countries canceled earlier this year 99% of debt owed by Somalia to some of the world’s wealthiest countries. Some of Somalia’s creditors, including the US, UK, and Russia, said they had canceled USD 2 bn in debt on “voluntary and bilateral basis.” Mogadishu is looking to return to the global financial system after over 30 years in exclusion in the wake of its civil war.

SPEAKING OF DEBT- Saudi has joined other Paris Club creditors including India in giving Ethiopia until 30 June to reach an agreement with the International Monetary Fund on a new assistance program. The creditors had given Ethiopia a two-year payment holiday that runs through the end of this year on the condition that Addis inks an agreement with the IMF, Bloomberg notes.

OIL WATCH-

Reassured by Opec’s approach to phasing out production cuts, portfolio investors are piling back into crude oil, Reuters reports, citing records filed to exchanges. Fund managers bought the equivalent of 69 mn barrels of Brent crude oil futures and options last week, marking the fourth-highest weekly growth rate in positions in over a decade. The move helped crude prices recover to the same levels as before Opec’s last meeting at the beginning of the month.

BACKGROUND-Energy Minister Prince Abdulaziz bin Salman said the oil cartel could backtrack on planned oil production increases if the market was not strong enough, Reuters reported earlier. Bin Salman criticized Goldman Sachs for having a bearish outlook on oil, which he said is based on incorrect data. Some media reports and forecasts “fiddle with the market,” the minister said.

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THE BIG STORY ABROAD-

What everyone in the global press is talking about now: Troops in Bolivia have pulled back from the presidential palace and nearby areas after trying to occupy the compound.

What they’ll be talking about when the business day begins: The 31 largest US banks have passed their annual “stress tests,” with this year’s scenario testing who could be wiped out by a hypothetical scenario that included 10% unemployment in the midst of a deep recession that also saw real estate prices drop 36-40%. The impact on the sector would be nasty, but banks including Goldman Sachs and JPMorgan Chase would all meet minimum regulatory standards.

What they’ll be talking about tonight and into the weekend: Donald Trump and Joe Biden face off tonight in the first of two presidential election debates. The fireworks start at 9pm Eastern (that’s 4am in Cairo and Riyadh, 5am in Abu Dhabi and Dubai). You’ll need to tune in to CNN to catch it, though it looks like they also plan to stream it on Youtube.

BRIEFLY NOTED-

#1- Fortune is out with a piece looking at how Aramco is using artificial intelligence to streamline its business as it looks to a post-oil world. Its use of AI can help it maximize oil production with limited human intervention, detect potential blockages across its pipelines early, and experiment with ways to best capture carbon from the atmosphere. “AI will give certain companies a huge advantage over others,” Aramco’s Executive VP for Innovation and Tech Ahmad Khowaiter told Fortune. “And this is where we believe we are going to be able to take the lead.”

#2- The Kingdom ranked number 16 in a 67-country ranking of the world’s most competitive economies. That’s one spot higher than Saudi ranked in last year’s IMD World Competitiveness Ranking (WCR), which gauges competitiveness based economic performance, government efficiency, business efficiency, and infrastructure. The Kingdom — which came in fourth among G20 economies — scored higher in economic performance and government efficiency. It led global rankings in several sub-indicators in the 2024 IMD World Competitiveness Yearbook, including cybersecurity, internet penetration per 1k people and others. It also came in second in stock market capitalization, venture capital and others.

CIRCLE YOUR CALENDAR-

The International Chemistry Olympiad — a competition for the world’s brightest chemistry students — will kick off in Riyadh on Sunday, 21 July. The three-day annual event is set to take place in King Saud University and will see teams of four students and two mentors from around the world undergo practical and theoretical assessments in chemistry.

The inaugural Aussie Expo in Riyadh will open its doors to visitors from Monday, 21 October to Tuesday, 22 October at the KAFD Conference Centre in Riyadh. Held under the theme “Accelerating Partnerships, Unlocking New Opportunities,” the one-day event will showcase potential investments between Saudi and Australia in agriculture, mining, technology, infrastructure, healthcare and education sectors. It is organized by Australian conglomerate Trademark Group of Companies seeking the entry of Australian firms to Saudi and the GCC.

The second Athar Festival Awards, honoring creative marketing in the Kingdom, will be held on 6 November at the Crowne Plaza in Riyadh. The award categories include campaign, leadership, young talent, and team awards. You can register for early bird entries until next Thursday, 6 July. Standard entry deadline is 29 August.

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